News Nuggets – March 2019

Bay Area

American Cannabis Companies Sign Deal with Canadian Producers

On Feb. 11, Oakland-based Harborside signed a deal with Toronto, Canada-based Lineage Grow Co. The two companies will merge, and Lineage Grow Co. will adopt the Harborside name. On the same day, Canada-based TerrAscend Corp. signed agreements with The Apothecarium to also establish a footprint in the United States. The deals represent the growing amount of partnerships between American and Canadian cannabis companies.”Today’s news is another major step in executing TerrAscend’s U.S. strategy. Ryan Hudson and his team have done a tremendous job building The Apothecarium and Valhalla into successful, world-class brands in the most sophisticated and coveted US markets,” stated Matthew Johnson, president of TerrAscend Corp., and TerrAscend USA, Inc. The Apothecarium operates four dispensaries in California and Nevada. The deals illustrate a shift towards larger partnerships with Canadian companies in the future.

Survey Indicates Californians Trust Cannabis Industry More than Social Media

Portions of the 2019 Edelman Trust Barometer Special Report, which measures how much peopl trust various things, were released on Feb. 13. According to the report, Californians said they trust the cannabis industry more than social media. Forty-seven percent of respondents said they trust that cannabis businesses are doing the right thing. While 44 percent said they trust dispensaries, and 43 percent said they trust cannabis cultivators, only 33 percent said they trust social media. “This year’s results reveal Californians’ increasingly complex view of the tech sector and their expectations that businesses will do more to improve local issues,” the report reads. “The findings are further underscored by growing employee expectations for their employers to take action to address societal concerns.” The findings reflect the growing stability of the cannabis industry and how people now perceive it.

Colorado

The Denver Elections council announced on Jan. 25 that the proposed Psilocybin Mushroom Initiative has been approved in Denver and will appear on the “Mile High City’s” 2019 spring ballot. Decriminalize Denver, the group responsible for the effort, collected 8,524 signatures, with 5,559 of those verified as valid. “We envision a society where individuals can use psilocybin mushrooms without fear of criminal or civil penalties. Psilocybin is shown to: Reduce psychological stress and suicidality; Reduce opioid use and dependence. Be physiologically safe and non-addictive,” states the initiative. Per the initiative, the consumption and possession of psilocybin would be Denver Police Department’s “lowest law enforcement” priority and those 21 and over may possess it without violating any law. Also stated in the proposal is the creation of the 11-member Psilocybin Mushroom Review Policy Panel, which would assess the potential impacts of the ordinance and it would include several members of Denver governmental branches.

Sweet Leaf Owners Sentenced to One Year in Prison

The owners of the Denver-based cannabis dispensary chain Sweet Leaf were recently sentenced to one year in prison after pleading guilty in court on Jan. 25. The investigation was initiated late in 2016 after the Denver Police Department was given a tip that the dispensary chain was conducting “looping” where the stores knowingly sold more than the allotted amount of cannabis that individuals can purchase in one day, which directly violates state laws. “This case began thanks to a watchful citizen who observed the same people making multiple purchases of marijuana from a single Sweet Leaf dispensary in one day and tipped off the Denver Police Department,” said Denver District Attorney Beth McCann in a statement. Prior to the court date, the three owners, Anthony Suaro, Christian Johnson and Matthew Aiken were ordered to sell all 26 of the Sweet Leaf business permits to pay the almost $2 million in fines. They are also prohibited from operating in the Colorado cannabis industry for the next 15 years.

Los Angeles

Los Angeles County Sheriff’s Deputy Marc Antrim and at least five other men were arrested for allegedly conspiring to stage a fake raid and steal 1,200 pounds of cannabis and $645,000 in cash, totaling over one million dollars. Last October, Antrim and two men, Eric Rodriguez and Kevin McBride, allegedly arranged a fake robbery at a downtown Los Angeles warehouse and left with the product and money. On Feb. 21, three more men, Matthew James Perez, Daniel Aguilera and Jay Colby Sanford were arrested on federal charges and signed plea deals for their participation in the conspiracy. “Deputy Antrim allegedly was able to use his law enforcement expertise and his access to Sheriff’s Department gear to stage a robbery that netted over a million dollars in marijuana and cash,” said United States Attorney Nick Hanna in a press release. “We cannot tolerate this type of behavior from sworn officers, and this case demonstrates our commitment to quickly address corrupt behavior by law enforcement.”

Michigan

Nine Cannabis Products Recalled

Nine cannabis products were flagged for containing unsafe ingredients or contaminants after failure to pass Michigan’s lab testing requirements. On Feb. 6, the Department of Licensing and Regulatory Affairs (LARA) issued a recall on cannabis products that were found at Elite Wellness in Vassar. Several types of products were deemed unsafe for human consumption. The products include the strains Agent Orange, Blue Cheese, Grand Daddy Purp, Lemon Drop, Ice Cream Cake, Orange Skittles and Super Lemon OG, plus AK Extracts Crumble and an edible product from Detroit Growers Extracts. “The Dept. of Licensing and Regulatory Affairs issued a health and safety advisory due to the sale of marijuana which failed laboratory testing. The products were sold between 11/13/18 and 2/1/19 at 664 Vassar, LLC (Elite Wellness Vassar),” the recall notice reads. Patients and caregivers who received these products are encouraged by LARA to return them to Elite Wellness.

A group of Michigan activists, led by poet John Sinclair, filed a lawsuit against the Michigan Board of Pharmacy to remove cannabis from the state’s Controlled Substances List, according to a Jan. 22 press release. Sinclair is joined by MINORML, Michigan’s branch of NORML as a plaintiff in the case. “Under Michigan law, the Board of Pharmacy is charged with the duty to schedule, re-schedule, and de-schedule substances based upon their medical benefits, relative harm and potential for abuse,” the press release reads. “Notwithstanding the passage of the Michigan Medical Marihuana Act and the Medical Marihuana Facilities Licensing Act, the Board continues to list marihuana as a Schedule I drug with no accepted medical benefits and high potential for abuse.” Listing cannabis under Schedule I contradicts the state’s medical cannabis laws, as it is reserved for substances with no medical value.

Oregon

Oregon Faces Massive Oversupply of Cannabis

On Jan. 31, the Oregon Liquor Control Commission (OLCC) released its Recreational Marijuana Supply and Demand Legislative Report, which identified a massive cannabis overproduction problem. During 2018, legal producers in the state grew 2,000 tons of “wet” cannabis—which could be amount to much as 6.5 years’ worth of cannabis supply. “Probably the biggest take away from the report is that over the course of a year, Oregon’s recreational marijuana program produced about twice as much marijuana as was purchased by consumers,” the report reads. “There are years of inventory currently sitting on the shelves at retailers, and being stored by producers and wholesalers.” The report began with a letter from OLCC Director Steve Marks, who highlighted the growing oversupply problem. The oversupply has caused a drop in prices that consumers see at the counter, and several options are being explored to control the problem.

Committee Approves Bill to Allow for Cannabis Exports

Oregon’s Senate Committee on Judiciary approved Senate Bill 582, a bill that would allow for cannabis exports across state lines, which would help abate the state’s oversupply problem. The bill “specifies that under laws of other state, production, processing, sale and testing of marijuana items must be lawful. It also “specifies that borders of this state must abut borders of other state,” and “prohibits transporting marijuana items through use of navigable airspace, through use of any mode of transportation subject solely to federal regulation and through any state or territory of United States that is not party.” The bill was sponsored by Sen. Floyd Prozanski and Rep. Ken Helm. It’s the first step toward approving the bill for implementation. On Feb. 7, a public hearing and a work session were scheduled as the bill makes its way towards the Oregon Senate and House for more approvals.

San Diego

Cannabis CEO Proposes Building Border Wall with Hempcrete

Brad McLaughlin, CEO of San Diego-based BudTrader.com, proposed a plan to build nearly 2,000 miles of President Donald Trump’s border wall—with hemp. His proposal suggests using hempcrete as a building material, and even former White House strategist Steve Bannon is backing the concept as of Feb. 11. “Our proposal is to construct 1,954 miles of border wall separating the United States and Mexico using ‘hempcrete’ and other industrial hemp by-products as building materials grown by both the United States and Mexico’s legal cannabis/hemp industries,” the proposal’s white paper states. Under the proposal, the cost could theoretically be covered using federal cannabis tax revenue. Bannon is also backing Air Force veteran Brian Kolfage’s GoFundMe called “We Build the Wall,” which raised $20.7 million as of mid-February to build a wall using undefined materials. McLaughlin first floated the idea last year to then-Rep. Dana Rohrabacher, who was voted out of office during the last election cycle.

Washington

Cannabis Billboard Ban Proposed to WA Legislature

House Bill 1466 was introduced on Jan. 22 by Washington officials who seek to ban cannabis billboard advertisements throughout the state. Sponsors of the bill include Reps. Brad Klippert, Steve Kirby, Laurie Jinkins, Lauren Davis and Christine Kilduff, who have voiced concerns with oversaturation, youth exposure and other potential implications of legal cannabis sales. A ban on cannabis advertisement on billboards could harm many cannabis business owners, such as Korbe Palmer, general manager of Lamar Advertising in Seattle. “This potential ban will affect Lamar negatively in the form of decreased revenue, potentially reducing living wage jobs,” Palmer told CULTURE. “We feel it will affect the revenue generated by the cannabis retailers, ultimately affecting the revenue base from which the state collects taxes and finally we feel it is overly burdensome, oppressive and just plain unnecessary.” This bill is currently being debated, and it remains to be seen if it will pass into law.

Cannabis-Related Traffic Fatalities Decrease in Washington

Recently, an Australian study entitled “Traffic fatalities within US states that have legalized recreational cannabis sales and their neighbors” found that several states with legal cannabis have seen an overall decrease in traffic fatalities following recreational cannabis legalization. It was widely predicted that following recreational cannabis legalization in Washington, cannabis-related traffic fatalities would increase. But evidence suggests that is not the case. The study’s author, Tyler Lane, told CULTURE about his findings. “The reason isn’t entirely clear,” Lane stated. “It could be related to cannabis legalization, e.g., there was long-term substitution from other, more impairing substances like alcohol, or increased police response, or some independent factor specific to Washington.” As Washington continues to pave the way for other legal cannabis states, this data set, and Washington’s regulatory practices, will provide a helpful example on how to mitigate risk and improve safety when it comes to legal cannabis and impaired driving.

National

World Health Organization Recommends Reclassifying Cannabis

According to an official letter dated Jan. 24, The World Health Organization (WHO) called for cannabis and cannabis resin to be removed from Schedule IV of the 1961 drug convention, which was signed by countries from around the world. WHO officials provided the recommendation for cannabis and cannabis resin “to be deleted from Schedule IV of the Single Convention on Narcotic Drugs (1961).” The letter was written by Tedros Adhanom Ghebreyesus, WHO’s director general, and the letter was sent to UN Secretary-General António Guterres. The organization also recommended to remove cannabis extracts and tinctures from Schedule I of the 1961 drug convention and to remove dronabinol from Schedule II, among other recommendations. Cannabis and cannabis resin, however, would remain under Schedule I of the 1961 drug convention, as it is designated under two schedules. Schedule I, unlike the U.S. federal system, is the least restrictive category.